Bankrupting America’s Spending Daily

Spending Daily | April 25, 2013

FAA Management: “Make Furloughs as Hard as Possible for the Public”The Wall Street Journal editorializes, “The Federal Aviation Administration claims the sequester spending cuts are forcing it to delay some 6,700 flights a day, but rarely has a bureaucracy taken such joy in inconveniencing the public. Though the FAA says it is strapped for cash, the air traffic control agency managed to find the dollars to update its interactive ‘command center’ tool on its website so passengers can check if their airports are behind schedule due to what it calls sequester-related ‘staffing’ problems. Oklahoma Senator Tom Coburn noticed this rare case of FAA technological entrepreneurship and fired off a letter Wednesday protesting what he called the agency’s ‘full blown media rollout’ to hype the flight delays. That had zero impact on FAA bosses, who were on Capitol Hill rationalizing their dereliction. But after Mr. Coburn published his letter on his website, FAA regional employees wrote to blow the whistle on their bosses. As one email put it, ‘the FAA management has stated in meetings that they need to make the furloughs as hard as possible for the public so that they understand how serious it is.’ Strategies include encouraging union workers to take the same furlough day to increase congestion. ‘I am disgusted with everything that I see since the sequester took place,’ another FAA employee wrote. ‘Whether in HQ or at the field level it is clear that our management has no intention of managing anything. The only effort that I see is geared towards generating fear and demonstrating failure.’”

“FAA Chief: Budget Flexibility Would Help, But We Haven’t Asked For It”The National Review reports, “Federal Aviation Administration (FAA) chief Michael Huerta said Wednesday that part of the reasons that disruptive furloughs are necessary is because he lacks the flexibility to transfer funds between different agency accounts. And the reason the FAA lacks that flexibility is because the Obama administration has not requested it; Congress could authorize this so-called transfer authority at any time.”

“Hostages On The Tarmac”The Chicago Tribune editorializes, “Hours before the federal spending sequester began on March 1, when President Barack Obama predicted that ‘People are going to be hurt,’ he did not add, Trust me, I’ll make sure of it. But he might as well have, as this week’s furloughs of air traffic controllers make obvious. The furloughs reflect panic: Having exaggerated their early predictions that the sequester’s small reduction in spending growth would seriously affect Americans, many Democrats are hell-bent to pre-empt those Americans from drawing two logical conclusions: If one level of cuts is this painless, then maybe we should make … more cuts to expenditures. And while we’re at it, maybe we should ignore the politicians who told us that if Washington lowered the spending growth curve … the Earth will fly into the sun. … Sure enough, travel delays have followed. We’re less certain, though, that this hostage-taking will cut the way the White House expects: The scheme relies on citizens being — how to put this delicately? — stupid enough to think that the Federal Aviation Administration can’t find a more flier-friendly way to save $600 million.”

Senators Introduce Legislation to End Air Traffic Controller Furloughs
According to The Hill, “A bipartisan group of senators said Wednesday that they were introducing legislation to stop air traffic controller furloughs that have been blamed for more 2,000 delayed flights this week. The group, led by Sens. Amy Klobuchar (D-Minn.) and John Hoeven (R-N.D.), said the legislation would allow the Federal Aviation Administration (FAA) to move funds between its accounts to prevent furloughs for its 15,000 air traffic controllers.”

White House Signals Openness to Legislation Eliminating FAA FurloughsThe Associated Press reports, “Under growing pressure, the Obama administration signaled Wednesday it might accept legislation eliminating Federal Aviation Administration furloughs blamed for lengthy delays affecting airline passengers, while leaving the rest of $85 billion in across-the-board spending cuts in place. The disclosure came as sentiment grew among Senate Democrats as well as Republicans for legislation to ease the impact of the cuts on the FAA, and Transportation Secretary Ray LaHood held talks with key senators. ‘I think there was a meeting of the minds’ on steps to remedy the situation, Sen. Jay Rockefeller, D-W.Va., said after the meeting. He said he hoped for a resolution before the Senate begins a scheduled weeklong vacation at week’s end. … Officials estimate the FAA furloughs will save slightly more than $200 million through Sept. 30, a small fraction of the $85 billion in overall reductions that stem from across-the-board cuts, officially known as a sequester, that took effect in March. Neither Rockefeller nor LaHood disclosed the terms of possible legislation.”

DOJ Furloughs Won’t Come Before OctoberCNN reports, “Thousands of Department of Justice employees can breathe a little easier after learning they won’t be furloughed due to forced budget cuts, but that assurance is good only until October 1, when a new fiscal year begins for the federal government. Attorney General Eric Holder sent a memo to department workers on Wednesday, which CNN obtained. It said, ‘thousands of critical FBI and ATF agents, deputy U.S. marshals, prosecutors, and other department employees will remain on the job protecting national security, fighting violent crime and enforcing our laws.’ Employees were expected to be furloughed as many as 14 days when across-the-board budget cuts went into effect earlier this year after the White House and Congress couldn’t agree on another way to reduce the deficit.”

Failed Electric Carmaker Received $529 in Taxpayer-Backed FundsReuters reports, “Taxpayer-backed funds kept flowing to electric carmaker Fisker Automotive months after the company failed to meet key production benchmarks, lawmakers said at a congressional hearing on Wednesday. Republican lawmakers on the House Oversight Committee cited Department of Energy documents as showing Fisker got $32 million in payments, even after it failed to launch its Karma vehicle in February of 2011. … The committee hearing focused on the DOE’s decision in 2009 to grant the company a $529 million loan only to see it veer toward bankruptcy – a chain of events with echoes of Solyndra, the government-backed solar manufacturer that went out of business in 2011.”

“Obama Wants to Make Sure You Don’t Retire Rich”Bloomberg reports, “A bullet point on Page 18 of President Barack Obama’s 2014 budget sounds ominous: ‘Prohibit Individuals from Accumulating Over $3 Million in Tax-Preferred Retirement Accounts.’ That it appears in a section titled ‘Strengthening the Middle Class’ is odd since such a proposal would seem to undermine the goal. Why, at a time when the government is looking to reform entitlement programs because it can’t keep the promises it has made to future generations, does Obama want to reduce the incentive to save? It makes no sense. Suddenly, the political agenda becomes obvious. Mitt Romney’s $102 million individual retirement account became an issue during the 2012 presidential election. Instead of offering a solution to prevent wealthy individuals from putting deeply discounted stock in their IRAs and earning huge, tax-free profits, Obama is looking to score political points. A very small segment — for a very small return. Limiting an individual’s total retirement balances to about $3 million, enough to finance ‘an annuity of not more than $205,000 per year in retirement,’ would raise $9 billion over 10 years, according to Obama’s budget proposal. Why, it makes it sound as if the danger is saving too much, not too little.”

Lawmakers May Be Given Obamacare ExemptionPOLITICO reports, “Congressional leaders in both parties are engaged in high-level, confidential talks about exempting lawmakers and Capitol Hill aides from the insurance exchanges they are mandated to join as part of President Barack Obama’s health care overhaul, sources in both parties said. The talks — which involve Senate Majority Leader Harry Reid (D-Nev.), House Speaker John Boehner (R-Ohio), the Obama administration and other top lawmakers — are extraordinarily sensitive, with both sides acutely aware of the potential for political fallout from giving carve-outs from the hugely controversial law to 535 lawmakers and thousands of their aides. Discussions have stretched out for months, sources said. Yet if Capitol Hill leaders move forward with the plan, they risk being dubbed hypocrites by their political rivals and the American public. By removing themselves from a key Obamacare component, lawmakers and aides would be held to a different standard than the people who put them in office. … The problem stems from whether members and aides set to enter the exchanges would have their health insurance premiums subsidized by their employer — in this case, the federal government.”

Now That the 3 Budgets Have Been Unveiled, What Happens Next?The Associated Press reports, “First the Republican-led House approved a federal budget that’s heavy on spending cuts. Then the Democratic-controlled Senate approved one that leans more toward tax increases. Then at last, President Barack Obama put out his own budget plan, two months late, coming down someplace in between. Sounds like progress, right? Check back on that. The competing proposals are more likely to produce just more budget gridlock. … Reaction to Obama’s budget laid bare the same partisan differences that have prevented legislators and the president from reaching a big budget deal all along. Republicans are adamantly against the new tax revenue in the president’s proposed budget and say they want to rein in spending on entitlement programs; liberal Democrats are irked that the president’s budget would make nicks in Social Security and Medicare and insist that tax increases need to be a bigger part of the mix. Those differences aren’t going anywhere – and will only become more pronounced as the 2014 elections near.”

Both Parties Talk About Reducing the Deficit But Fail to ActThe Associated Press reports “Liberals’ loud objections to White House proposals for slowing the growth of huge social programs make it clear that neither political party puts a high priority on reducing the deficit, despite much talk to the contrary. For years, House Republicans have adamantly refused to raise income taxes, even though U.S. taxes are historically low, and the Bush-era tax cuts were a major cause of the current deficit. And now, top Democrats are staunchly opposing changes to Medicare and Social Security benefits, despite studies showing the programs’ financial paths are unsustainable. Unless something gives, it’s hard to see what will produce the significant compromises needed to tame the federal debt, which is nearing $17 trillion.”

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